This office lease clause should be used in an expense stop, stipulated base or office net lease. When the building is not at least 95% occupied during all or a portion of any lease year, the landlord shall make an appropriate adjustment for each lease year to determine what the building operating costs. Such an adjustment shall be made by the landlord increasing the variable components of such variable costs included in the building operating costs which vary based on the level of occupancy of the building.
The Kings New York Gross up Clause is a crucial provision that should be incorporated into an Expense Stop Stipulated Base or Office Net Lease. This clause ensures fairness and accuracy in the allocation of operating expenses between the landlord and the tenant. Simply put, the Gross up Clause allows for the "grossing up" of certain variable expenses incurred by the landlord, such as property taxes, insurance premiums, and common area maintenance costs. The purpose of grossing up is to account for changes in occupancy levels or fluctuations in expenses that might affect the total amount payable by the tenant. There are different types of Gross up Clauses that can be used depending on the specific lease terms and the intentions of the parties involved: 1. Full Building Gross up: Under this clause, the landlord is allowed to adjust the operating expenses based on the occupancy level of the entire building. This means that if the building is not fully occupied, the expenses will be "grossed up" to account for a hypothetical full occupancy scenario. This type of Gross up Clause is often favored by landlords, as it ensures they are not shouldering a disproportionate burden of the expenses. 2. Floor-by-Floor Gross up: In leases covering multi-tenant buildings, this clause allows for the grossing up of expenses on a floor-by-floor basis. It acknowledges the fact that occupancy levels can greatly vary from one floor to another. By using this type of Gross up Clause, landlords ensure that expenses are fairly allocated based on the actual occupancy of each floor. 3. Expense Stop Gross up: This clause sets a predetermined expense stop, which is a maximum threshold beyond which the landlord is responsible for all additional expenses. If the actual expenses exceed the expense stop, the landlord can then gross up the excess amount. This type of Gross up Clause provides a clear and defined boundary for both parties, allowing for transparency and predictability in expense calculations. In conclusion, incorporating a Kings New York Gross up Clause in an Expense Stop Stipulated Base or Office Net Lease is crucial for ensuring fairness and accuracy in expense allocation. It allows for the adjustment of variable expenses based on occupancy levels or fluctuations in expenses. Different types of Gross up Clauses, such as Full Building, Floor-by-Floor, and Expense Stop Gross up, can be utilized depending on the lease terms and the intentions of the parties involved.The Kings New York Gross up Clause is a crucial provision that should be incorporated into an Expense Stop Stipulated Base or Office Net Lease. This clause ensures fairness and accuracy in the allocation of operating expenses between the landlord and the tenant. Simply put, the Gross up Clause allows for the "grossing up" of certain variable expenses incurred by the landlord, such as property taxes, insurance premiums, and common area maintenance costs. The purpose of grossing up is to account for changes in occupancy levels or fluctuations in expenses that might affect the total amount payable by the tenant. There are different types of Gross up Clauses that can be used depending on the specific lease terms and the intentions of the parties involved: 1. Full Building Gross up: Under this clause, the landlord is allowed to adjust the operating expenses based on the occupancy level of the entire building. This means that if the building is not fully occupied, the expenses will be "grossed up" to account for a hypothetical full occupancy scenario. This type of Gross up Clause is often favored by landlords, as it ensures they are not shouldering a disproportionate burden of the expenses. 2. Floor-by-Floor Gross up: In leases covering multi-tenant buildings, this clause allows for the grossing up of expenses on a floor-by-floor basis. It acknowledges the fact that occupancy levels can greatly vary from one floor to another. By using this type of Gross up Clause, landlords ensure that expenses are fairly allocated based on the actual occupancy of each floor. 3. Expense Stop Gross up: This clause sets a predetermined expense stop, which is a maximum threshold beyond which the landlord is responsible for all additional expenses. If the actual expenses exceed the expense stop, the landlord can then gross up the excess amount. This type of Gross up Clause provides a clear and defined boundary for both parties, allowing for transparency and predictability in expense calculations. In conclusion, incorporating a Kings New York Gross up Clause in an Expense Stop Stipulated Base or Office Net Lease is crucial for ensuring fairness and accuracy in expense allocation. It allows for the adjustment of variable expenses based on occupancy levels or fluctuations in expenses. Different types of Gross up Clauses, such as Full Building, Floor-by-Floor, and Expense Stop Gross up, can be utilized depending on the lease terms and the intentions of the parties involved.
